Bhanumati Michael Scribe Vs ITO (ITAT Ahmedabad)
Income Tax Appellate Tribunal (ITAT), Ahmedabad, has ruled in favor of Bhanumati Michael Scribe, an NRI, quashing an addition of ₹8,31,500 made by the Income Tax Department under Section 69A of the Income Tax Act, 1961. The addition was related to cash deposits made in her bank account during the demonetization period.
The case stemmed from the assessment year 2017-18, during which the assessee deposited ₹10,00,000 in cash. Following an online verification under “Operation Clean Money,” the Income Tax Department flagged the deposit as substantial and, noting the assessee’s failure to file an income tax return for the relevant assessment year, deemed ₹12,12,093 as unexplained/undisclosed money under Section 69A. This amount was then taxed at a rate of 60% under Section 115BBE of the Act. Additionally, the Assessing Officer (AO) made an addition of ₹8,59,800 as undisclosed Long Term Capital Gain from the sale of a property purchased in 1978, for which the sale consideration was ₹35,00,000.
Aggrieved by the assessment order, the assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi, who partly allowed the appeal. Subsequently, the assessee approached the ITAT challenging the CIT(A)’s confirmation of the ₹8,31,500 addition under Section 69A.
